--Cattle futures trim gains after brushing all-time highs last
reached in July
--Profit-taking weighs on some live, feeder-cattle futures
--Hog futures mixed, pressured in October contract by cash
market
By Kelsey Gee
CHICAGO--U.S. cattle futures have retreated since climbing to
the all-time record intraday price earlier Monday, pressured by
profit-taking as traders work to assess the supply outlook of
available cattle.
October live-cattle futures are down 0.625 cent, or 0.4%, to
$1.59125 a pound at the Chicago Mercantile Exchange, after notching
the highest close in five weeks on Friday. That contract has risen
2.5% over the past week, and early in the trading day Monday jumped
to a record peak last hit in July. December live-cattle are up 0.1%
to $1.6105 a pound.
September feeder cattle are up 0.62 cent to $2.2635 a pound,
after advancing 3.2% last week.
Cattle futures for three consecutive days last week rallied by
the exchange-imposed daily limit of three cents as traders see
supplies of market-ready animals remaining tight in the months
ahead.
Feedlot operators have slowed the pace of sales to beef
processors in recent weeks, reflecting record high costs for
replacement animals, known as feeder-cattle. This has forced
packers to bid more aggressively for available supplies,
underpinning gains in the cash and futures market for fattened
cattle.
"The feeder cattle market continues to be a skyrocket," said
Bryan Vasseur, a broker with Compass Hedging in Fort Collins,
Colo., noting the small pool of available light-weight animals.
"Some feedyards know that once they sell a pen of cattle it'll be
even more pain to fill it back up."
But after consecutive days of sharply higher prices, analysts
noted profit-taking and technical selling was curbing fresh gains
on Monday.
Hog futures are mixed, under pressure in the front-month
contract due to the heavy premium to recent prices paid in the cash
markets. Cash and futures prices typically converge near the
expiration of the front-month contract, which is a little over one
month away.
Market participants anticipate supplies of available hogs will
expand in the months ahead following a pinch due to a deadly swine
virus, though modest gains in the wholesale pork market have
recently slowed the decline in cash market prices.
October hog futures are down 1.70 cents to $1.0392 cents a
pound, after surging 7.6% over the past week. December hogs are up
0.55 cent to 96.00 cents a pound.
Write to Kelsey Gee at kelsey.gee@wsj.com
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